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Gates Scores Points for Appearance

BY Jube Shiver

04/25/2002

by Jube Shiver on 4/25/02.

The decision to put brilliant but volatile Microsoft Corp. Chairman Bill Gates on the stand in the most important antitrust case since the breakup of Standard Oil Co. turned out to be not so risky after all.

In the end, after three days of testifying in Microsoft's landmark antitrust trial in U.S. District Court, it mattered little whether the world's richest man presented a powerful legal argument. What mattered more, experts say, is that Gates simply showed up in court and came across as a human being.

It was a classic courtroom strategy to win sympathy by showing a human element amid the complex legal arguments over corporate bullying.

"He's helped because he's put a human face on the company," said Ernest Gellhorn, an antitrust expert and law professor at George Mason University in Fairfax, Va.

Gates' appearance in court this week certainly seemed to resonate in a courthouse where just four years ago the airing of his videotaped deposition compounded Microsoft's legal woes.

That video, which showed an evasive and petulant Gates slumped in a chair, marked a low point for the company. It so riled the original trial judge in the case that, in an interview published after the trial, he likened Gates to Napoleon.

But taking the witness stand for the first time in his company's landmark antitrust case, Gates got a more benign reception.

He drew a standing-room-only crowd during his first day of testimony. And, more important, he drew the rapt attention of Judge Colleen Kollar-Kotelly, who took copious notes and frequently looked directly at Gates while he testified.

"It was a calculated risk, but it paid off huge," said Erick Gustafson, a vice president at Citizens for a Sound Economy, a conservative lobby group that has supported Microsoft's fight against the government.

"The videotape depicted Gates as evasive, out of touch, surly and rude," Gustafson said. "But all of those myths were dispelled by his appearance in court. He was gracious on the stand, and he was engaged."

Gates also may have been helped by the states' dilemma in questioning him.

The software mogul remains a popular figure--both in Silicon Valley and among the public at large.

That fact may have figured in the states' decision to let the more gentle and low-key attorney Steven Kuney question Gates rather than lead lawyer Brendan V. Sullivan Jr., one of Washington's best-known litigators.

Sources close to the states say that Kuney--who conducted Gates' deposition--was better prepared to question the software mogul. And some legal experts say Kuney's methodical and deferential approach was well suited to eliciting damaging admissions from Gates.

On Wednesday, for example, Gates acknowledged that Microsoft already has a kind of modular version of Windows that his government adversaries have long insisted Microsoft should offer to consumers.

Gates said Windows XP Embedded, a special Windows version that is marketed to retail outlets and others for use in cash registers, kiosks and the like, is customizable and allows customers to include or leave out Microsoft's Internet Explorer browser, Windows Media Player and other software.

Earlier this week, Gates had testified that it would be impossible to produce a version of Windows with removable features because Internet Explorer and many other software components are dependent on one another.

But Gates said third-party software cannot be installed on Windows XP Embedded because it works differently from the consumer versions of Windows.

Despite the admission, Gates, for the most part, delivered a courtroom message little different from that of other Microsoft witnesses: that tough antitrust punishment sought by the District of Columbia, California and eight other states suing Microsoft would cripple the software giant and hurt the computer industry.

But Gates' appearance was significant nonetheless. It marked one of the few times that he has stepped out of his protective cocoon of publicists, security guards and other aides to publicly defend himself and his company in a forum he does not control--the courtroom.

It is an experience that other executives have faced with fear and sometimes regret.

"Some of these CEOs hate lawyers [and the judicial process], but more often than not it pays to have that face there," Gellhorn said.

Said Keith Blackwell, who as president of Bristol Technology Inc. testified several years ago in an antitrust suit his company brought against Microsoft: "In terms of single events, being a witness in a federal trial is the most compressed pressure I've faced as a CEO."

"You have to be careful, because the things you say that you think might be helping you can have a totally opposite effect," he said. "You have to be patient enough to give that 'yes' or 'no' answer... That's real difficult for CEOs to do because they are used to people giving them deference."

Gates got little of that during his three days in the courtroom.

On Wednesday, for instance, Kollar-Kotelly kept Gates cooling his heels for nearly an hour and a half outside the courtroom as she debated procedural matters with lawyers for Microsoft and the states.

And during another point earlier in the trial when testimony was briefly suspended, Gates appeared relieved when the court bailiff sauntered near him and struck up a conversation while Kollar-Kotelly held a lengthy bench conference with lawyers.

Gates did his best to remain polite. He smiled and occasionally even joked with his adversary--state trial lawyer Kuney. At one point during cross-examination Wednesday, Gates quipped to Kuney that--like Windows--the states' remedy proposals were so tightly integrated it would be tough to remove or modify the individual proposals without breaking the whole thing.